About twenty years ago, a famous hamburger chain ran a series of commercials featuring a cute octogenarian named Clara Peller. This feisty little old lady claimed her fifteen minutes of fame asking that now famous question, “Where’s the beef?” While it may have been funny to watch her put fast food restaurant owners on the spot, it is not at all funny if you’re in a car accident and you ask the other driver for their insurance card only to find out they have none.
Unfortunately that’s a scenario that happens all too frequently. As the cost of living rises and paychecks don’t meet needs, people start making decisions about where to cut expenses. One of those decisions may be to eliminate or greatly reduce the amount of their car insurance. They need the car and take the calculated risk that they won’t get into an accident, but invariably, they are wrong. In fact, the possibility of an uninsured motorist hitting you is greater than you may realize. There are some states in which almost 32 percent of all drivers do not carry automobile insurance. The national average is 14 percent.
You can protect yourself from an uninsured driver, or even an underinsured driver, whose negligence causes you to be involved in an accident. The first way is with uninsured motorists (UM) coverage. It provides insurance protection for bodily injury, and in some states, property damage, caused by an uninsured driver. This type of policy permits you to collect from your own insurance carrier just as if it provided liability coverage for the uninsured driver.
Uninsured motorist bodily injury coverage pays for your medical expenses, lost wages, and other damages when you or your passengers are injured in an accident caused by a driver without car insurance. Uninsured motorist coverage also pays for injuries that result from a hit-and-run accident. Policy owners choose the coverage limit when they buy their policy.
Uninsured motorist property damage coverage protects you if your vehicle is damaged in an accident caused by a driver without car insurance. Other protection provided by this type of policy varies from state to state. If available, the deductible for uninsured motorist property damage is usually $250. This is often substantially less than the collision coverage deductible found in your auto insurance policy.
The other policy alternative is underinsured motorists (UIM) coverage. This provides insurance protection for bodily injury, and in some states, property damage, caused by a negligent motorist who is not sufficiently insured and whose negligence results in an accident. The bodily injury portion of this kind of coverage pays for your medical expenses, lost wages, and other damages when you or your passengers are injured. It usually pays the difference between the coverage limit you select and the other driver’s bodily injury coverage limit.
Underinsured motorist property damage coverage protects you if your car is damaged in an accident caused by a driver with insufficient auto insurance coverage. Other specific protection provided by this type of coverage varies by state. As with bodily injury, property damage coverage pays the difference between your policy’s coverage limit and the other driver’s property damage coverage limit.
When you are deciding whether or not to buy either of these coverages, keep two very important points in mind. Both UM and UIM coverage are broad in scope because they provide benefits for you and your family members’ injuries that occur in your own covered car, in cars you don’t own, and as pedestrians. Despite all of this protection, the cost for this coverage is reasonable compared to liability coverage and physical damage coverage for your own car.